Spokane, Wash.-based Focused Behavior Solutions, an applied behavior analysis provider for children with autism, filed for Chapter 11 bankruptcy Oct. 8 in the U.S. Bankruptcy Court for the Eastern District of Washington.
The company is reorganizing under Subchapter V, a streamlined process for small businesses, and will continue operating during the case. It reported $172,884 in assets against $528,898 in liabilities, including $178,372 owed to merchant cash advance lenders. It had $383 in its bank accounts on the filing date.
Founded in 2016, the company serves about 1,400 outpatient patients, according to court filings. Gross revenue fell from $3.59 million in 2024 to $3.16 million in 2025, and totaled $1.82 million for 2026 through the filing date.
In an Oct. 13 court declaration, Rachel Pope, owner and managing member, tied the filing to three things. The first was leadership and staffing disruptions. The second was a billing backlog of claims that weren’t submitted on time. The third was a significant cut to Nebraska reimbursement rates for certain direct ABA services. Its website lists clinic locations in Walla Walla and Lincoln, Neb. To cover payroll, the company turned to merchant cash advances, and their frequent repayments drained its operating cash.
Ms. Pope said in the filing that the distress stems from “an unsustainable repayment structure, not a failure of operations or lack of demand.”
The company has cut administrative overhead, eliminated management positions, closed or scaled back underperforming locations and revamped its billing process. It has also asked the court to let it pay $68,096 in prepetition wages, taxes and benefits owed to 32 employees. The company also listed the Internal Revenue Service among its priority creditors, with a $140,780 payroll tax claim.
Focused Behavior Solutions projects that once the merchant advance withdrawals stop, its cash flow can cover payroll and fund plan payments under Subchapter V.
Becker’s has reached out to Focused Behavior Solutions for comment and will update this story if more information becomes available.
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